IRS Audit may result in Probe on Chavez Operations

An IRS audit that detailed irregularities in the operations of the Cesar Chavez Network could result in a criminal probe. The audit, which was released last month, highlighted the exorbitant salaries of the leaders of Cesar Chavez Academy and Dolores Huerta Preparatory High, conflicts of interest including acts of nepotism when hiring workers and expense accounts that seemed dubious.

http://www.getirshelp.com/irsblog/June 21, 2010 IRS Audit may result in Probe on Chavez Operations An IRS audit that detailed irregularities in the operations of the Cesar Chavez Network could result in a criminal probe. The audit, which was released last month, highlighted the exorbitant salaries of the leaders of Cesar Chavez Academy and Dolores Huerta Preparatory High, conflicts of interest including acts of nepotism when hiring workers and expense accounts that seemed dubious. A husband and wife pair, Lawrence and Annette Hernandez who worked as the Corporate Executive Officer and Corporate Operating Officer in the network respectively, were dismissed by the Cesar Chavez Academy board over this matter last month. The couple responded with their own written 7-page statement in which they described their dismissal and the audit revelations as „irresponsible and speculative in its conclusions‟. According to the couple, their salaries were always determined by the board. They also claimed that the IRS did not approach them for their input on the matters the audit highlighted. The Hernandezes stated their outrage and offense at what they called the „unwarranted personal attacks‟ leveled against them by the Colorado Department of Education (CDE) and the media arising out of the audit review. The Hernandezes went on to say in their response, “It was an effort to dig up as much dirt on us as possible, which the CDE and (Pueblo City Schools) have now unfortunately used to further attack and smear our reputations and character”. When the Pueblo District Attorney was asked whether this matter would be probed by his office, the DA would only say that they have received lots of information from many citizens regarding the operation of the Cesar Chavez School Network and that their office has been in touch with the Attorney General‟s Office, the Colorado Department of Education as well as School District 60 officials (Pueblo City Schools), among others. DA Bill Thiebaut gave no firm indication one way or the other over the probe, saying only, “Our staff continues to review this information and to communicate with other entities who also are reviewing the audit and information that they have obtained. For now, that is all I am at liberty to say”. http://www.getirshelp.com/irsblog/On the other hand, the Attorney General‟s office have confirmed that they have not launched any investigation into the Cesar Chavez Network and further clarified that any probe would have to come from one of the AG‟s clients, like the CDE or the Charter School Institute. The CDE said it has not started any probe but would support one if it was called for by Pueblo City Schools. Pueblo City Schools said they have already done their part by forwarding copies of the audit together with letters expressing concerns to the relevant authorities like the DA‟s office and the IRS. Its stand is that these authorities have the prerogative to launch the probe.

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